Insurance claims having multiple potential outcomes are difficult to evaluate. In the case of medical claims, for example, the extent of a claimant's future medical recovery is both indeterminate and inversely related to total claim cost (i.e., total severity).
According to existing techniques for evaluating a claim having multiple potential outcomes, an adjuster determines a most probable outcome based on her professional experience and based on the file history of the subject claim. A total severity is then estimated based on the determined outcome. The adjuster may use the estimated total severity as a basis for adjusting insurance reserves, suggesting treatment options, reallocating resources (e.g., triggering a nursing assignment or physician review), and/or re-assigning the claim to a more (or less) senior adjuster.
Conventional evaluation techniques do not provide a robust system to determine relative likelihoods of potential outcomes in order to identify a most probable outcome.
Conventional techniques also exhibit difficulty in estimating the total severity of an identified most probable outcome. Moreover, any actions performed by an adjuster based on the estimated total severity fail to take into account outcomes which present a lower probability but a higher exposure than the determined most probable outcome, and outcomes which present a lower probability and a lower exposure than the determined most probable outcome. Consequently, improvements in any of the foregoing deficiencies may improve the quality of these actions (e.g., reserve adjustments, treatment suggestions and claim reassignments) to the benefit of the claimant and the insuring entity.